U.S. regulator the Commodity Futures Trading Commission (CFTC) has hit Uniswap Labs, the company behind Ethereum decentralized exchange Uniswap, with an order for allegedly illegally offering leveraged or margined retail commodity transactions in digital assets.
The order, which the regulator said was settled, requires Uniswap Labs pay a $175,000 civil monetary penalty and to cease and desist from violating the Commodity Exchange Act (CEA).
"Today, Uniswap Labs resolved a CFTC investigation, about a small fraction of a percent of trading through our interface related to a handful of tokens, for a $175k fine in a standard no admit-no deny settlement," Uniswap Labs Chief Legal Officer Katherine Minarik told Decrypt. "We remain singularly focused on building the future of DeFi for everyone and taking on the fights necessary to make that happen."
CFTC Director of Enforcement Ian McGinley said in the regulator's statement that "DeFi operators must be vigilant to ensure that transactions comply with the law."
Uniswap Labs Fires Back Against SEC’s 'Weak and Wrong' Legal Threats
Uniswap Labs, creator of the popular Ethereum decentralized exchange Uniswap, said Tuesday that it had filed a response to the Securities and Exchange Commission (SEC) after being put on notice of a potential enforcement action from the U.S. regulator. “Their legal arguments are weak and have been refuted by courts,” the company said of the SEC in a blog post. “The SEC’s aggressive theories are an effort to expand its jurisdiction beyond exchanges to communications technology—and beyond securiti...
Uniswap is a platform that allows people to trade cryptocurrencies. Unlike centralized exchanges like Coinbase or Binance, it's a decentralized exchange (DEX)—a platform that anyone can use to trade coins and tokens without a middleman—and runs on the second-biggest crypto network, Ethereum. It's powered by autonomous smart contracts, which hold the code that enable decentralized apps (dapps).
It is the biggest DEX in the space, CoinGecko data shows, with a current 24-hour trading volume tally of $888 million.
The price of Uniswap's UNI token dropped by nearly 2% in the hour following the CFTC's announcement before peaking again. CoinGecko shows that asset is now trading for $6.45, a nearly 8% jump over the last 24 hours.
Ripple CEO Predicts SEC Chair Gary Gensler’s Exit, Whoever Wins Election
During a press conference at Korea Blockchain Week 2024 in Seoul, fintech firm Ripple Labs' CEO Brad Garlinghouse predicted the ouster of U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler, whatever the outcome of the looming presidential election. According to a report in the Korean Herald, Garlinghouse said he would “make a gentleman’s bet” that Gensler’s tenure would not continue, regardless of who takes the White House in November. Ripple to Pay $125 Million Fine for Unregister...
It isn't the first time Uniswap has landed in the crosshairs of a regulator: In April, the Securities and Exchange Commission issued a Wells Notice to the exchange after investigating it for years. A Wells Notice is sent when the regulator intends to take enforcement action against a company or individual.
Then, in May, Uniswap Labs pushed back against the regulator, claiming that the SEC's legal arguments were "weak" and an "effort to expand its jurisdiction beyond exchanges to communications technology—and beyond securities to all markets."
Editor's note: This story was updated after publication with additional details.
Edited by Andrew Hayward
